There was no mistaking the optimism in Rich Coleman’s voice when he spoke about the prospects of British Columbia’s fledgling liquefied natural gas industry at CERAWeek in Houston last month.

“One (project), I think, will go to an FID (Final Investment Decision) this summer and a couple of smaller ones may go to the next stages. I think in the first quarter of 2016 there will be one or two more” said B.C.’s deputy premier and minister of natural gas development.

The project Coleman expected would advance to an FID was Pacific Northwest LNG, backed by Malaysia’s Petronas.

“Petronas has advanced a long way. They are in the Canadian environmental assessment, they are in the market for money, they have their engineering done and they have been in the market getting prices,” said Coleman.

It’s unlikely Coleman expected the Lax Kw’alaams First Nation would reject Petronas’ $1-billion offer aimed at winning approval for the project, as happened this week.

The Lax Kw’alaams unanimously voted down — by a show of hands — the Petronas offer, which amounted to $320,000 per person to its 3,600 members over a 40-year period.

The result immediately raised the question as to whether this is the proverbial canary in the coal mine that should send every other LNG project proponent scurrying back to the drawing board.

The challenges Enbridge has faced trying to build its Northern Gateway pipeline are well-known, but no one expected similar opposition to occur around LNG proposals.

Yet it has, again calling into question the process by which approvals are sought from First Nations in areas where projects are to be built.

The Lax Kw’alaams’ rejection of the project — and the proposed payout — suggests its opposition will not be solved with a bigger cheque.

Those with an ear to the ground in B.C. suggest the decision is about genuine environmental concerns and why some say the vote could be a ‘game-changer’ in the B.C. LNG world.

What’s surprising about the Lax Kw’alaams’ unanimous rejection is that it occurred at this late stage. Many observers this week said the possibility of a rejection based on environmental concerns might have surfaced long before it was put to a vote. In fact, the site Petronas chose for its project terminal was rejected 20 years ago based on similar environmental concerns raised this week.

While 3,000 members of the Lax Kw’alaams live off-reserve, the First Nation has become an economic force through its forestry and fishing enterprises; a First Nation not unlike many in Alberta that has developed its own source revenue model critical for the long-term sustainability of its peoples.

The Lax Kw’alaams transformed its situation in 2004 when it bought New Skeena Forest Products out of bankruptcy for $4.8 million. It has since expanded its business enterprises to include fish processing — the band has the largest facility on B.C.’s coast and customers in the U.S. and China.

And once again the vote has highlighted the often-voiced criticism that the energy sector is too late to the game when it comes to when and how it carries out its duty to consult. In this case, it’s unclear when meetings would have occurred between Petronas and the Lax Kw’alaams to explain the proposal and discuss the concerns.

The interesting twist in all of this is that part of the deal involved a land transfer from the province valued at $108 million of Crown lands that was predicated on the Lax Kw’alaams approving the deal with Petronas. This underscores the importance the B.C. government has placed on the development of LNG as a critical component for its future economic growth.

As Coleman said last month, the natural gas supply in B.C., at a 30 per cent rate of recovery, will last for 150 years. The resource represents significant value to the province and is why Premier Christy Clark is committed to laying the groundwork to foster a new industry and attract the billions of dollars in investment that come with LNG projects.

The B.C. government isn’t likely happy with the vote outcome as it recognizes the fact companies like Petronas have the ability to allocate capital around the world. If the above-ground risk becomes too great, that’s what will happen.

“We know they have other opportunities worldwide. My job is to make sure that anything they need from a government perspective and an investment climate is good for them in B.C.,” Coleman said.

While the Lax Kw’alaams vote is undoubtedly a setback, it would be naive to think it’s over. It’s likely discussions involving all three parties — the Lax Kw’alaams, the B.C. government and Petronas — will continue in a manner aimed at finding some common ground that has nothing to do with Petronas writing a bigger cheque.

It should be a reality cheque (pun intended) for every one of the proponents behind the 19 proposed LNG projects in B.C., not to mention those seeking to build pipelines intended to broaden market access.

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